Tonight, the September PCE data, which was delayed by two months due to the US government shutdown, will finally be released. This is also the last influential macro data before the December 10 FOMC meeting and the final public observation window for Federal Reserve policy.

The current market game is essentially a battle between "lagging inflation rebound" and "forward-looking economic slowdown."

The current market expectations are an annual rate of 2.9% and a monthly rate of 0.2%.

The probability of a rate cut by the CME in December is 87.2%.

If tonight's PCE print comes in below expectations, it will further strengthen next week's rate cut expectations. The market will see this as evidence that inflation is under control. Coupled with the weak ADP employment data on Wednesday, this could help risk markets rebound further.

If the PCE print is above expectations but not excessively high, bulls may use the lagging nature of the data as an excuse, arguing that this is September data from three months ago and that the current oil prices and employment environment have changed.

Due to Wednesday's ADP report unexpectedly showing a decrease of 32,000 jobs, the margin for error for this data release is higher. In other words, even if the PCE data is not ideal, Powell can still justify a rate cut on the grounds that "because monetary policy is lagged, we need a preemptive rate cut to prevent a collapse in the job market."

The most favorable outcome tonight would be a core PCE monthly rate of 0.2%, confirming inflation is under control and the economy remains resilient, which would be the most bullish scenario overall.

If the result is a core PCE monthly rate of 0.3% or above, US Treasury yields may rebound, and the market may worry about long-term inflation, which would be negative for the medium- and long-term market outlook.

In summary, tonight's PCE is a key short-term sentiment catalyst, but it can no longer solely determine the market's long-term fate. The real challenge lies in how the market, after the data is released, will re-anchor asset values in a new environment of slowing growth, stubborn inflation, and policy struggling to balance its "dual mandate."